Shadow Money Group Discloses Adelson Donation

This article is part of an exclusive series on politically active tax-exempt organizations that don’t disclose their donors. You can read the other stories in the series here.

A little-known non-profit with ties to the oil and gas industry that has recently begun attacking President Barack Obama for restricting America’s “energy opportunity” revealed late last week that it is receiving substantial funding from Sheldon Adelson, the casino owner who has dumped tens of millions of dollars into outside spending groups this election year.

Following the 2010 Citizens United vs. Federal Election Commission decision, social welfare organizations, known as 501(c)(4) groups after the section of tax code they are governed by, are allowed to spend unlimited amounts of money directly advocating for the election or defeat of candidates through political ads — up to just under half of their total budgets. But unlike super PACs, they are under no obligation to disclose their funders. The Center for Responsive Politics has dubbed these organizations “shadow money groups” for their lack of transparency.

However, on Oct. 19, the New American Energy Opportunity Foundation, a 501(c)(4) group, made a filing with the FEC that actually disclosed the funder of a new series of radio commercials.

According to the group’s report, which you can see here, the organization paid Marketel Media, of Temecula, Cal., nearly $800,000 for the production and placement of a radio ad on “energy independence issues.” The filing shows that every dime of the advertisements’ cost was paid for by Adelson. The Center for Responsive Politics was not able to locate a copy of the advertisement, but the group’s website indicates that the organization’s main issue is reducing restrictions on drilling for gas and oil in the United States.

A video posted on the group’s YouTube account makes it very clear that President Barack Obama is the true target of the ad — and that Romney is the group’s solution.

“America has the richest oil and natural gas resources in the world, but President Obama puts drastic restrictions on our oil and natural gas development… He cut leases on federal lands, we lost thousands of jobs,” the ad’s narrator claims. The message echoes a Romney talking point that he stressed in his second debate with Obama.

“Liberals hate American energy and restrict it again and again; we must elect pro-energy leaders,” the ad continues, showing a picture of Romney speaking at a campaign event.

Under current campaign finance law, 501(c)(4) groups are only required to disclose the names of donors if the donor specifically earmarks their donation to fund a certain expenditure. In other words, if a donor just gives a certain amount of the group and doesn’t specify how they want the money spent, there is no obligation to disclose. Apparently, in this case, Adelson specified he wanted the money spent for this series of radio ads.

Adelson began his involvement this campaign cycle with a vigorous backing of Newt Gingrich in the Republican primary — he and his wife Miriam gave Winning Our Future, the super PAC that backed Gingrich, $15 million. The Adelsons have now given a total of $39 million to conservative super PACs, but this is the first concrete evidence of the couple giving money to non-disclosing groups — which Adelson has said he prefers — as well.

According to the filing, the form was prepared by Stefan C. Passantino — a lawyer who also served as Gingrich’s attorney. The only other two names publicly associated with the group are the group’s chairman, Scott Noble, the founder of Noble Royalties, an oil and gas company that specializes in buying mineral rights and collecting royalties, and Martin Fleming, the group’s president, who is Noble Royalties’ communications director.

Russ joined the Center in March 2012 as the money-in-politics reporter. His duties include reporting for OpenSecrets Blog and assisting with press inquiries. Russ has a background in investigative journalism, having worked as a reporter for the Investigative Reporting Workshop at American University, and he spent five years as a newspaper reporter in New Hampshire. He has a degree in political science from Muhlenberg College and a M.A. in journalism and public affairs from American University.

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